Advancements in networking and computing technologies have enabled transformation of computers from low performance/high cost devices capable of performing basic word processing and computing low-level mathematical computations to high performance/low cost machines capable of a myriad of disparate functions. For example, a consumer level computing device can be employed to aid a user in paying bills, tracking expenses, communicating nearly instantaneously with friends or family across large distances by way of email, obtaining information from networked data repositories, and numerous other functions/activities. Computers and peripherals associated therewith have thus become a staple in modern society, utilized for both personal and business activities.
The Internet in particular has provided users with a mechanism for obtaining information regarding any suitable subject matter. For example, various web sites are dedicated to posting text, images, and video relating to world, national, and/or local news. A user with knowledge of a Uniform Resource Locator (URL) associated with one of such web sites can simply enter the URL into a web browser to be provided with the web site and access content thereon. Another conventional manner of locating desired information from the Internet is through utilization of a search engine. For instance, a user can enter a word or series of words into a search field and thereafter initiate the search engine (e.g., through depression of a button, one or more keystrokes, voice commands, . . . ). The search engine then utilizes search algorithms to locate web sites related to the word or series of words entered by the user into the search field, and the user can then select one of the web sites returned by the search engine to review content therein.
As more and more people have begun to utilize the Internet, it has become apparent that revenue opportunities exist for small and large businesses alike. For instance, many retail companies utilize the Internet to sell goods online, thereby reducing costs associated with managing and maintaining a store location, providing an ability to centralize inventory, and various other similar benefits that result in decreased costs that are passed on to customers. Given this increased use of the Internet for generating business and/or revenue, it has also become apparent that the Internet can be utilized as an advertising mechanism. In one example, an individual who enters the term “flower” into a search engine may be interested in purchasing flowers—thus, it is beneficial for a company that sells flowers to advertise to that user at the point in time that the user is searching for the aforementioned term. Oftentimes users will see the advertisements and click on such advertisements to purchase flowers, thereby creating business for the flower retailer. Furthermore, the search engine is provided with additional revenue by selling advertisement space for a particular period of time to the flower retailer when the term “flower” is utilized as a search term.
Conventionally, advertising space relating to search terms provided to a search engine is bought or sold in an auction manner. More specifically, a search engine can receive a query (from a user) that includes one or more search terms that are of interest to a plurality of buyers. The buyers can place bids with respect to at least one of the search terms, and a buyer that corresponds to the highest bid will have their advertisement displayed upon a resulting page view. Bidding and selection of a bid can occur within a matter of milliseconds, thereby not adversely affecting usability of the search engine. Thus, two or more competing bidders can bid against one another within a limited time frame until a sale price of advertising space associated with one or more search terms in the received query is determined. This bidding is often accomplished by way of proxies (e.g., computer component) that are programmed with a demand curve for specific search term(s). As alluded to above, auctioning advertising space associated with search terms is a substantial source of revenue for search engines, and can further be a source of revenue for advertisers.
Auctioning of advertising space based upon received search terms works adequately with respect to terms that are associated with high demand and/or terms that are associated with a substantial amount of pricing data. For example, continuing with the above “flower” example, it can be assumed that the search term “flower” is a common search term and is associated with high demand (particularly during portions of the year proximate to certain holidays) with respect to advertisers wishing to display advertisements on a page view resulting from such term. More specifically, a number of bidders will be bidding against one another for advertising space on a resulting page view, thereby ensuring that the search engine will receive suitable revenue for such term.
The auction of space upon page views associated with search terms, however, is inadequate when the search terms are uncommon or are associated with low demand. For example, a single bidder can exist with respect to a search term associated with low demand (e.g., an uncommon search term), thereby enabling such bidder to purchase advertising space at an extremely low price. It is understood, however, that low frequency queries are not necessarily queries associated with low demand, as there may be a large number of bidders that may wish to advertise with respect to the queries (or terms therein). Similarly, high frequency queries are not necessarily queries associated with high demand, as there may be a small number of buyers interested in purchasing advertising space associated with high frequency queries. Due to the substantial number of searches that are conducted by way of search terms associated with low demand, a search engine can lose a significant amount of possible revenue. In an attempt to capture some of this possible revenue, search engines utilize reserve prices with respect to advertising space purchases. For a specific example, a search engine may set a reserve price of five cents for all advertising space thereon, and buyers can bid against such reserve price. If a bid exceeds the reserve price, the owner of such bid will have an advertisement displayed upon a resulting page view. If a bid does not exceed the reserve price, no advertisements are displayed upon a page view resulting from a received search query.